In the matter of Grant Thornton Australia Ltd [2026] NSWSC 898 | Case summary | Zoe

NSWNSWSC

In the matter of Grant Thornton Australia Ltd

[2026] NSWSC 898

Supreme Court of NSW|2026-07-28|Before: Black J

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At a glance

Source facts

Court

Supreme Court of NSW

Decision date

2026-07-28

Before

Black J

Catchwords

CORPORATIONS – arrangements and reconstructions – schemes of arrangement or compromise – application under s 411 of the Corporations Act 2001 (Cth) for orders convening meeting of members to consider and, if thought fit, to agree to proposed scheme of arrangement – whether requirements to order scheme meeting are satisfied

Source

Original judgment source is linked above.

Catchwords

CORPORATIONS – arrangements and reconstructions – schemes of arrangement or compromise – application under s 411 of the Corporations Act 2001 (Cth) for orders convening meeting of members to consider and, if thought fit, to agree to proposed scheme of arrangement – whether requirements to order scheme meeting are satisfied

Judgment

Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.

Medium Neutral Citation: In the matter of Grant Thornton Australia Ltd [2026] NSWSC 898

Hearing dates: 30 June 2026

Date of orders: 30 June 2026

Decision date: 28 July 2026

Jurisdiction: Equity - Corporations List

Before: Black J

Decision: Order convening scheme meeting and associated orders made

Catchwords: CORPORATIONS – arrangements and reconstructions – schemes of arrangement or compromise – application under s 411 of the Corporations Act 2001 (Cth) for orders convening meeting of members to consider and, if thought fit, to agree to proposed scheme of arrangement – whether requirements to order scheme meeting are satisfied

- Corporations Act 2001 (Cth), s 9, Ch 2L, ss 411, 1319 - Securities Act 1993 (US), s 3(a)(10)

By Originating Process filed on 12 June 2026, the Plaintiff, Grant Thornton Australia Limited (“GTAL”) seeks orders under ss 411 and 1319 of the Corporations Act 2001 (Cth) (“Act”) in respect of a proposed scheme of arrangement with its shareholders, other than Excluded Shareholders as defined in a Scheme Implementation Deed (“SID”) dated 27 April 2026 in respect of the scheme.
By way of background, GTAL is an unlisted public company which conducts an accounting and professional services business. The GTAL Group provides, inter alia, audit services, financial advisory services and tax services. GTAL operates in conjunction with a partnership which provides services to GTAL and its associated entities to enable GTAL’s provision of professional services to its clients. About 99% of the shares which are the subject of the proposed scheme are held by existing principals (referred to as “partners”) of GTAL or their nominees (excluding Retiring Partners, as defined in the SID) and about 1% of those shares are held by Grant Thornton Consolidated Limited (“GTCL”), which is in turn owned by the relevant partners.
The proposed scheme contemplates the acquisition of shares in GTAL by Turbo Fast Track Buyer Pty Ltd (“Fast Track”) which is an indirect wholly-owned entity of Turbo Parent Partnership LP (“Turbo LP”), which owns the Grant Thornton Advisors Multi-National Professional Services Platform, and Turbo EMEA Holdings BV as Guarantor. The proposed consideration for the acquisition is generally a mix of cash and scrip consideration, comprising limited partnership interests in Turbo LP, as determined by specified allocation principles set under the SID, with several newly appointed partners of GTAL to receive only scrip consideration.
I made the orders sought by GTAL at the conclusion of the hearing on 30 June 2026. These are my reasons for doing so. I have drawn on the helpful submissions of Mr Thomas, with whom Mr Atkin appeared for GTAL, in this judgment.

GTAL reads the affidavit dated 12 June 2026 of Ms Kylie Brown, a solicitor acting for it in the proceedings, which addresses the commencement of the proceedings and leads formal evidence.
By an affidavit dated 29 June 2026, Mr Said Jahani, who is the Chief Executive Officer of GTAL, sets out the background to GTAL, which was established in January 2008 with the amalgamation of several state-based practices which had previously operated independently under the Grant Thornton Brand and has since made additional acquisitions; and the nature of the scheme, to which I have referred above. Mr Jahani also refers to the SID which provides for Fast Track’s acquisition of the GTAL shares and sets out proposed implementation steps in respect of the scheme; he refers to the possibility that GTAL may pay Permitted Dividends (as defined) under the proposed scheme; he notes that, as disclosed in the scheme booklet, the GTAL Group may pay transaction bonuses to several employees, executives and partners, which may include its directors, if the scheme becomes effective; and he also addresses the position in respect of management incentive schemes operated by GTAL.
Mr Jahani notes that, on 16 June 2026, each eligible GTAL shareholder was notified of their indicative allocation of cash consideration and scrip consideration in accordance with the allocation principles under the SID. The proposed scheme booklet was also amended in the course of the scheme hearing to contain additional disclosures, in general terms, as to the bands of cash consideration and scrip consideration that are allocated to eligible GTAL shareholders. Mr Jahani also addresses the manner in which the scheme consideration will be paid by Fast Track, the treatment of Retiring Partners (as defined) under the proposed scheme and the manner in which the scheme meeting would be conducted; and he confirms the consent of the proposed chair and alternate chair for the scheme meeting.
Mr Jahani also notes that, unusually but understandably in the relevant circumstances, GTAL’s directors had decided not to commission an independent expert report in connection with the scheme, where its directors themselves have extensive experience in public company management and professional services, and consider that sufficient information has been available to them and the GTAL shareholders in respect of the scheme. Mr Jahani also refers to the content of and verification of the scheme booklet and the manner in which the scheme booklet would be despatched to GTAL shareholders. He notes that GTAL’s board unanimously recommended that eligible GTAL shareholders vote in favour of the scheme, in the absence of a Superior Proposal (as defined), and that each GTAL director intended to vote in favour of the scheme in respect of all GTAL shares they controlled, absent a Superior Proposal. He also addresses interests of the GTAL directors in GTAL shares, the break fees and exclusivity provisions in respect of the scheme and conditions precedent to the scheme. He notes that, again understandably in the circumstances, GTAL did not propose to conduct a shareholder information line but would announce the scheme internally to GTAL shareholders.
By an affidavit dated 28 June 2026, Mr Patrick Dillon, who is a director of Fast Track describes the nature of its business; notes that information concerning Fast Track had been prepared for distribution to scheme shareholders on a confidential basis; and refers to the verification process adopted in respect of information concerning Fast Track in the scheme booklet and to the manner in which Fast Track would fund payment of the cash component of the scheme consideration.
Mr Thomas took me through the scheme booklet which was exhibited to Mr Jahani’s affidavit in the course of submissions.
GTAL also tenders a letter dated 29 June 2026 from ASIC, which confirmed that ASIC had had a reasonable opportunity to examine the terms of the scheme and, in accordance with ASIC’s usual practice, reserved its position in respect of s 411(17) of the Act to the second Court hearing. That letter went beyond ASIC’s customary form of letter for the first Court hearing to make several thoughtful observations as to the nature of the proposed scheme as follows:

Mr Thomas addresses the well-established principles as to the Court’s role at the first Court hearing in respect of a scheme in submissions. The Court will determine, in the exercise of its discretion, whether to approve the convening of a scheme meeting and the explanatory statement if it is satisfied of several matters, namely that the plaintiff is a Pt 5.1 body; the proposed scheme is an “arrangement” within the meaning of s 411 of the Act; the scheme is bona fide and properly proposed; ASIC has had a reasonable opportunity to examine the proposed scheme and explanatory statement, to make submissions and has had 14 days’ notice of the proposed hearing date of the first Court hearing; the procedural requirements under the Supreme Court (Corporations) Rules 1999 (NSW) (“Rules”) have been met; and there is no apparent reason why the scheme should not, in due course, receive the Court’s approval if the necessary majority of votes is achieved: Re Orion Telecommunications Limited [2007] FCA 1389 at [5]; Re Staging Connections Group Ltd [2015] FCA 1012 at [19]; Re Wridgways Australia Ltd [2010] FCA 1187 at [30]; Re Ellerston Global Investments Ltd [2020] NSWSC 879 at [25]; Re Vocus Group Ltd [2021] NSWSC 630 at [12]; Re Absolute Equity Performance Fund Ltd [2022] FCA 933 at [18]–[22].
The Court will not ordinarily summon a scheme meeting unless the scheme is of such a nature and cast in such terms that, if it achieves the statutory majority at the meeting, the Court would be likely to approve it. The Court will consider whether the proposed scheme is fit for consideration at the proposed scheme meeting, in the sense that it is of such a nature and cast in such terms that, if it achieves the statutory majority at the meeting, the Court would be likely to approve it on the hearing of a petition which is unopposed; and members are to be properly informed as to the nature of the scheme before the scheme meeting: F T Eastment & Sons Pty Ltd v Metal Roof Decking Supplies Pty Ltd (1977) 3 ACLR 69 at 72, approved in Australian Securities Commission v Marlborough Gold Mines Ltd (1993) 177 CLR 485 at 504; [1993] HCA 15; Re Foundation Healthcare Ltd (2002) 42 ACSR 252; [2002] FCA 742 at [36] and [44], cited with apparent approval in Re CSR Ltd (2010) 183 FCR 358; [2010] FCAFC 34 at [58]; Re InvoCare Ltd [2023] NSWSC 1180 at [16]–[17].
I am here satisfied that each of the preconditions to the exercise of the Court’s discretion in s 411 of the Act is satisfied in this case. GTAL is a company registered under the Act and a Pt 5.1 body. The proposed scheme is an “arrangement” within the scope of s 411 of the Act where it involves the acquisition of the shares in GTAL in return for consideration being paid to its shareholders. There is no reason to suggest that the scheme is not bona fide or properly proposed, and GTAL’s directors have formed the view that the scheme is in the best interests of its shareholders and have unanimously recommended that shareholders vote in favour of the scheme, in the absence of a Superior Proposal. ASIC has here had a reasonable opportunity to examine the proposed scheme and scheme booklet, to make submissions and has had the necessary notice of this hearing and, as I noted above, has indicated that it does not currently propose to appear to make submissions or intervene to oppose the scheme at this hearing.
Mr Thomas submits and I accept that:

Mr Thomas also addresses several further matters. First, Mr Thomas points out that the statutory requirement for an independent expert report to accompany a scheme booklet in a members' scheme of arrangement under Pt 5.1 of the Act only applies where the acquiring entity holds at least 30% of the shares in the target or there is a common director between the acquiring entity and the target, and neither is the case here. Mr Thomas recognises that it is common practice for a scheme company in a members’ scheme of arrangement to commission an independent expert report and provide it to shareholders as part of the scheme booklet. However, he submits, and I accept, that there may be circumstances where an independent expert report is not required to inform shareholders as to the merits of the proposed transaction: Re Airtrain Holdings Ltd [2013] FCA 209. I accept, as ASIC has also fairly recognised, that this is such a case, where GTAL’s directors themselves have significant experience in public company management and professional services; they have formed the view, based on the level of information that has been made available to them and GTAL shareholders, that it was not necessary to commission an independent expert report in connection with the scheme; GTAL shareholders are plainly sophisticated and experienced professionals with expertise in financial matters; and the scheme concerns the business in which they are engaged. I accept that, in these circumstances, the absence of an independent expert report would not warrant the Court declining to convene the scheme meeting in this case.
Second, Mr Thomas recognises that GTAL shareholders will generally receive cash consideration and (subject to compliance with certain conditions) scrip consideration, but they will not receive the same amount of consideration per scheme share, where individual allocations will vary by reference to the scheme consideration allocation principles under the SID. Mr Thomas submits, and I accept, that this approach reflects the existing position, where GTAL shareholders’ rights to receive dividends also depend upon remuneration principles which involve elements of differentiation. I also recognise that GTAL shareholders who are participating in the scheme will receive a copy of the scheme booklet, which discloses the allocation approach and, as amended in the scheme hearing, the bands in which cash and scrip allocations will be made. Each participating GTAL shareholder has already been provided a letter setting out, among other things, their indicative allocations of cash and scrip consideration and the estimated total aggregate value of their scheme consideration allocation; and will, prior to the scheme meeting, be provided a further letter setting out their final individual allocations of cash and scrip consideration, subject to the Scheme Consideration Adjustment Payments (as defined), the final amounts of which will be separately notified in accordance with the terms of the SID.
Mr Thomas submits, and I accept, that it is sufficient, given GTAL’s existing approach to dividends, that the scheme consideration that each GTAL shareholder will receive (and, I add, the basis of allocations) are disclosed to that shareholder, and fair disclosure does not require that shareholder also be advised of each other GTAL shareholders’ indicative or final allocation outcomes. A shareholder who knows his, her or its own allocation is sufficiently informed to determine whether he, she or it wishes to vote in favour of the scheme and, if that shareholder does not accept that approach, then it may vote against the scheme on that basis.
Mr Thomas submits, and I also accept, that the fact that GTAL shareholders will receive somewhat different consideration under the scheme does not have the result that they are unable to consult together with a view to their common interest or should vote in different classes, particularly where this reflects the result of common allocation principles: Re SG Fleet Group Ltd [2025] NSWSC 214 at [15]; Re HMA International Ltd [2026] NSWSC 401 at [31]–[38]. In any event, I accept that that matter may properly be deferred to the second Court hearing, where it is not now apparent that any lack of separate classes will have the result that the scheme could not be approved by the Court. I am reinforced in that view by GTAL’s indication that it will tag each vote at the scheme meeting, so that the Court will be in a position to assess whether the convening of separate meetings of cohorts of GTAL shareholders would have produced any different result at the second Court hearing.
Third, Mr Thomas notes that GTAL does not propose to establish a shareholder information line, where each GTAL shareholder participating in the scheme meeting is or is an entity associated with a partner of Grant Thornton Australia. That matter requires no explanation, where the provision of a shareholder information line is not and should not become a necessary requirement to convene a scheme meeting.
Fourth, Mr Thomas addresses the question of management incentive plans. He points out that Fast Track and Turbo LP have agreed to make available an Australian allocation of incentives that will be made available to certain partners and employees (“Australian Incentive Allocation”) following implementation of the scheme. The Australian Incentive Allocation is described in section 3.10(a) of the scheme booklet. The incentives have a substantial estimated aggregate notional value, although Mr Thomas points out that their actual economic value will likely be significantly less than their notional value and is inherently uncertain. An initial allocation is proposed to be issued on or around implementation of the scheme, with a notional value of $31million to 83 eligible GTAL shareholders; and the estimated notional value of the individual allocations associated with that initial allocation ranges from approximately $25,710 to $2,000,000, with an average allocation of approximately A$186,803. I accept that this allocation is not part of the scheme consideration and, on that basis, the recipients of the initial Australian Incentive Allocation need not vote as a separate class at the scheme meeting: Re Nzuri Copper Ltd [2019] WASC 189 at [37]; Re McGrath Ltd [2024] NSWSC 555 at [25]. Mr Thomas acknowledges, and I accept, that to the extent this matter has any relevance, it is properly addressed at the second Court hearing.
Fifth, Mr Thomas notes that Fast Track intends to rely on an exemption from the registration requirements of the Securities Act 1993 (US) (“Securities Act”) provided by s 3(a)(10) of the Securities Act in connection with the issuance of Turbo LP units to GTAL shareholders pursuant to the scheme. I record that the Court has been informed at the time of the first Court hearing that the Court’s approval of the scheme will be relied upon by Fast Track for the purpose of qualifying for that s 3(a)(10) exemption under the Securities Act.
Sixth, Mr Thomas notes that certain GTAL shares held by Retiring Partners (as defined) (and any entity holding GTAL shares associated with that Retiring Partner) will be acquired by GTCL (as an excluded shareholder) outside of the scheme, and will be subsequently transferred by GTCL to Fast Track on or shortly following implementation of the scheme. This matter provides no reason not to convene the scheme meeting.
Seventh, Mr Thomas addresses the question of performance risk. He notes that, as at the date of the scheme booklet, the estimated amount of cash consideration that Fast Track may be required to pay to GTAL shareholders is approximately A$450,363,000 (“Estimated Cash Consideration”), subject to any Value Adjustment (as defined) in accordance with the terms of the SID. Fast Track intends to fund that cash consideration with a combination of cash reserves and, if necessary, additional debt funding under the Fast Track Group's existing facilities, as disclosed in section 4.9(b) of the scheme booklet. There is no reason to doubt Fast Track’s view that it will be able to satisfy its obligations to fund the scheme consideration when due and payable under the terms of the scheme and the deed poll, and this matter also provides no reason not to convene the scheme meeting.
Eighth, Fast Track, Turbo LP and the Guarantor have executed a deed poll dated 28 June 2026 under which, subject to the scheme becoming effective, Fast Track and Turbo LP have each undertaken in favour of each GTAL shareholder that they will observe and perform their obligations under the scheme, including their respective obligations relating to the provision of the scheme consideration (including Turbo LP's obligation to issue the relevant number of Turbo LP units to the GTAL shareholders under the terms of the scheme and the deed poll); and the Guarantor has undertaken in favour of each GTAL shareholder to guarantee the due and punctual performance of all of Fast Track's obligations (including its financial obligations) under the scheme. The transfer of the scheme shares under clause 5.5(b) of the scheme is conditional upon Fast Track having satisfied its obligations under clause 5.5(a) of the scheme, and GTAL shareholders will not be exposed to the risk of losing title to their shares and being left to sue upon the deed poll. I accept that mechanisms of this kind provide a means of managing performance risk: Re Simavita Holdings Ltd [2013] FCA 1274 at [43]; Re Australian Leisure and Entertainment Management Ltd [2021] NSWSC 1421 at [28].
Ninth, Mr Thomas notes that the SID contains, at clause 11, exclusivity arrangements in favour of Fast Track which apply during the Exclusivity Period (as defined). Mr Thomas rightly recognises that, in assessing exclusivity terms, the Court is concerned to ensure that any exclusivity period should be for no more than a reasonable period capable of precise ascertainment; an exclusivity clause directed at dealing with an unsolicited alternative merger proposal should be subject to a fiduciary carve out; and the provision must be clearly disclosed in the explanatory statement sent to shareholders: Re Arthur Yates & Co Ltd (2001) 36 ACSR 758; [2001] NSWSC 40 at [9]. The End Date under the SID is approximately 8 months from its execution, and I accept that is not an unreasonable period in the circumstances of the transaction. The exclusivity provisions are otherwise in common form, and these matters also provide no reason not to convene the scheme meeting.
Tenth, Mr Thomas recognises that GTAL has agreed to pay Fast Track a reimbursement fee in specified circumstances. That reimbursement fee is 1% of the implied adjusted equity value of the scheme and is consistent with the Takeovers Panel’s guidance as to the amount of such a fee. That fee is not payable on the failure of GTAL shareholders to approve the scheme or the Court not approving the scheme, and is not a disincentive to GTAL shareholders in their consideration of the scheme: Re Adelaide Bank Ltd [2007] FCA 1582 at [31]; Re Bolnisi Gold NL (No 2) (2007) 65 ACSR 510; [2007] FCA 2078 at [12]. Eleventh, the scheme includes deemed warranties in conventional terms. I accept that clauses in these terms are permissible and now commonplace, and the existence of the deemed warranties is appropriately disclosed in the scheme booklet. These matters also provide no reason not to convene the scheme meeting.
Twelfth, Mr Thomas notes that GTAL’s directors who hold GTAL shares will be entitled to receive the scheme consideration in respect of the GTAL shares owned or controlled by them, which will be allocated in accordance with the scheme consideration allocation principles set out in the scheme booklet. GTAL’s chief executive officer, Mr Jahani, will also enter into a Services Deed as summarised in the scheme booklet; and his existing services agreement with GTAL and the existing partnership will be terminated, resulting in a pro-rata vesting of his existing long term incentive entitlements. Consistent with the approach to allocations of each GTAL shareholder's scheme consideration, the specific proposed and final allocations of scheme consideration to be received by each of the GTAL directors is not specifically disclosed, as identified in the scheme booklet. While that would likely not be acceptable in a transaction involving a listed company, it seems to me that disclosure of the principles by which the scheme consideration is calculated is sufficient in the context of this transaction. Mr Thomas also points out that, if the scheme becomes effective, transaction bonuses may be paid by GTAL to certain employees, executives and partners of the GTAL Group, which may include GTAL directors, and this is also disclosed in the Chair's letter and in the scheme booklet. Each GTAL director has expressed the view that it is important and appropriate for them to provide a recommendation to GTAL shareholders in relation to voting on the scheme.
Mr Thomas submits that:

In the matter of Grant Thornton Australia Ltd

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